Causes of Long-term Unemployment and Successful Reduction Initiatives
Ministry of ManpowerSpeakers
Summary
This question concerns the causes of long-term unemployment and successful mitigation initiatives, as raised by Mr Desmond Choo. Minister for Manpower Dr Tan See Leng explained that structural skills mismatches are the primary cause, though the long-term unemployment rate successfully recovered to 0.7% in 2022. The Government tackles this through the SkillsFuture ecosystem, Jobs Transformation Maps, and support for job redesign via the Productivity Solutions Grant. Career Conversion Programmes specifically provide up to 90% salary support for employers hiring long-term unemployed or older workers, aiding 35,000 locals since 2018. Consequently, nine in 10 participants remained employed after 24 months, with 60% earning higher wages than in their previous positions.
Transcript
28 Mr Desmond Choo asked the Minister for Manpower (a) what are the causes of long-term unemployment over the last five years; and (b) what initiatives have been successful in reducing long-term unemployment.
Dr Tan See Leng: Prior to COVID-19, the annual average resident long-term unemployment rate (LTUR) was 0.7% from 2018 to 2019. Resident LTUR rose to 1% in 2020 and 2021 as a result of the economic downturn due to the pandemic. It has, however, since recovered to 0.7% in 2022. Singapore's resident LTUR remains relatively low compared to the Organisation for Economic Co-operation and Development (OECD) average of 2.6%1.
Long-term unemployment is mainly structural, with the top job search difficulty cited being mismatches in skills and qualifications. In particular, older workers aged 50 and above are disproportionately affected by long-term unemployment, with an LTUR of 1% in 2022.
We are proactively tackling the problem of skills obsolescence to reduce the chances of workers falling into long-term unemployment, and these measures have been effective in keeping the LTUR low. It starts with ensuring that everyone has a strong start through access to quality education and supporting lifelong learning through a strong SkillsFuture ecosystem. We also publish the Jobs Transformation Maps, which are detailed sectoral manpower studies mapping out the impact of technology and digitalisation over the medium-term, to identify opportunities for employers to transform their jobs and upskill their workers for these transformed job roles.
Employers can tap on various Government programmes for business and workforce transformation, such as Workforce Singapore's (WSG's) Support for Job Redesign under Productivity Solutions Grant. Employers can also partner with the National Trades Union Congress to establish Company Training Committees for additional support in their transformation journey.
Jobseekers who require assistance can tap on WSG's suite of employment facilitation services and programmes, several of which provide enhanced support for the long-term unemployed and older workers. In particular, WSG's Career Conversion Programmes (CCPs) help jobseekers to reskill for in-demand growth jobs and provide higher support of up to 90% of salary costs for employers who hire candidates that are long-term unemployed or aged 40 and above. CCPs have supported over 35,000 locals from 2018 to 2022 and the results have been encouraging. About nine in 10 CCP participants remained employed 24 months after embarking on the programme, and about six in 10 earned more than their last drawn salaries.